June 8 (SeeNews) - The Belgrade city government has announced the signing of a memorandum of understanding with Power Construction Corporation of China (Powerchina) to build a heat pipeline for an estimated 200 million euro ($224.9 million).
Once completed, the project will allow the city to cut the cost of providing heating energy by 43 million euro a year, i.e. the investment will be repaid in five or six years, Belgrade mayor Sinisa Mali said in a statement on Wednesday.
The construction of the heat pipeline will also reduce Serbia's dependence on natural gas imports and the fluctuations in gas prices, Mali said.
Serbian state-owned utility Beogradske elektrane pays 140 million euro for the import of natural gas annually, he added.
Fnancing for the construction of the 28 km pipeline that will connect Termoelektrane Nikola Tesla (TENT) power plant and Novi Beograd thermal power plant could be provided through a public-private partnership, a loan, or funds from the profit of state-owned utility Beogradske elektrane, the chairman of Belgrade City Assembly, Nikola Nikodijevic, said in April.
TENT comprises the Nikola Tesla A, Nikola Tesla B, Morava and Kolubara coal-fired power plants with a combined installed capacity of 3,286 MW.
($ = 0.889369 euro)